How Not To Grow Your Money (And What To Do Instead)

However much money we have, we could always use a little more. The trouble is that no matter how hard we work, no matter how many extra shifts we put in or however many extra hours we may stay behind at work without complaint, we never quite seem to have enough. On paper, we should be golden. We work hard and our salaries (for the most part) reflect that. The trouble is that life has a habit of getting in the way.

All it takes is an unexpectedly high electricity bill here and some unexpected car repair costs there and the illusion of financial safety and comfort evaporates almost instantaneously. We’re sick of just scraping by. We want to get out there and see the world. We want to make sure that our kids get all the things we missed out on when we were younger and we want to be able to splash out on life’s little luxuries without feeling guilty. We know that the only truly effective way to do this is by growing our money… But there’s a right way to do it and a wrong way to go about it…

Stop relying on your high street savings account

Most people choose a bank in their teens or early twenties and stick with them either out of blind loyalty or simply because they don’t consider it worth the hassle to switch. While this makes a modicum of sense when it comes to your current account, you could be losing out on a small fortune if your savings have languished for years in a high street savings account. These accounts have notoriously low rates of interest (averaging at around 0.06%APY).

Instead, try switching to an online savings account. As online lenders have fewer overhead costs they will be more likely to pass the savings onto you in the form of more favourable rates. Here are some of this year’s best online savings accounts.

Stop putting all of your investment eggs in one basket

Many of us supplement our savings with some form of investment, whether that’s in stocks, Forex (foreign exchange) or cryptocurrencies like Bitcoin. While this is admirable, it’s all too tempting to put all of your eggs in one basket, especially if a stock is doing consistently well. Be advised that the stock market is a fickle creature and even high performing stocks can take a turn for the worst.

Diversify your portfolio and you’ll be insulated from risk while still enjoying healthy dividends. Don’t be afraid to cast the net a little wider and invest in unfamiliar or overseas stocks; here are some of the best Japan ETFs. Needless to say you will need to put in a little research but the rewards speak for themselves.

Stop putting in overtime

Overtime is overrated. Sure you might get a little extra in your pay packet for spending even more time away from your loved ones but after the IRS has taken a chunk is it really worth the extra effort. Not only are the financial benefits fairly negligible, you run the risk of burning out (which benefits nobody). Instead, invest your free time in developing a side hustle. Of course your side hustle is still taxable income but you can develop your own business doing something you love and are passionate about with uncapped earning potential that eclipses anything you could hope to make doing overtime.